MLB Squeeze Play Has XM Sweating

It could be that one of XM’s earliest and costliest content deals is coming back to haunt shareholders.

According to a recent regulatory filing, XM is struggling to maintain a required $120 million escrow account for the benefit of Major League Baseball. The revelation has at least one Wall Street analyst concerned that XM might choose to issue more stock, a dilution that would hurt existing shareholders.

XM announced its MLB deal Oct. 19, 2004, when Wall Street was giddy about rapid subscriber growth and not too concerned about XM’s balance sheet.

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